https://www.wemakescholars.com/education-loan/kerala
Education Loan in Kerala
✓ Education Loan up to 2 Cr
✓ Featuring an interest rate as low as 8.30%
Table of content
- Which Bank is Best for Education Loan in Kerala?
- Education Loan Interest Rate in Kerala
- Kerala Gramin Bank Education Loan Scheme
- Other Education Loan Features Offered By Banks Or NBFCs In Kerala
- Documents Required For Availing An Education Loan in Kerala
- Common Reasons For Education Loan Rejection in Kerala
- Repayment Plan For Education Loans In Kerala
- Education Loan Subsidy Schemes Applicable To Students From Kerala
- Institutions For Higher Education In Kerala
- Why Choose WeMakeScholars For An Education Loan In Kerala?
- FAQ's
- Need Help? Ask Here!
Education is the key to success, but it comes with a cost. Many students in Kerala aspire to pursue higher education in India and abroad but are unable to do so due to financial constraints. This is where education loans come into play. In this article, we will discuss everything you need to know about education loans in Kerala, including eligibility criteria, documentation, interest rates, and repayment terms.
On average, students in Thiruvananthapuram, Kochi and Alappuzha need around INR 15 lakhs to finance their education within India, and around INR 45 lakhs to study abroad. Education loan interest rates in Kerala can range from 8.5% to 13%, depending on the type of loan and the lender. More information is available below.
Which Bank is Best for Education Loan in Kerala?
Numerous banks in Kerala provide education loans to students seeking funds to complete their higher studies in India or abroad. Here we have listed down the best bank and their loan details, you can check them out before your education loan process
For Studies In India and Abroad
Bank name | Scheme name | Loan amount and Collateral Requirement | Processing fee |
SBI | SBI Scholar Loan Scheme | Upto 1.5 Crores with collateral | 10K + GST |
BOB | Baroda Scholar Scheme | Depends on the university | 10K + GST |
Karur Vysya Bank | Education Loan Scheme | Upto 1.5 Crores with collateral | 10K + GST |
Union Bank | Union Bank India Education Loan Scheme | Upto 2 Crores with collateral | 1-2% of the loan amount |
Axis Bank | Axis Bank Education Loan Scheme | Upto 40 Lakhs unsecured | 1-2% of the loan amount |
ICICI Bank | ICICI Bank Education Loan Scheme | Upto 50 Lakhs unsecured | 1-2% of the loan amount |
IDFC First Bank | IDFC Bank Education Loan Scheme | Upto 50 Lakhs unsecured | 1-2% of the loan amount |
Avanse | Avanse Education Loan Scheme | Upto 60 Lakhs (for India) Upto 75 lakhs (for abroad) |
1-2% of the loan amount |
Incred | Incred Education Loan Scheme | Upto 60 Lakhs (for India) Upto 75 lakhs (for abroad) |
1-2% of the loan amount |
Auxilo | Auxilo Education Loan Scheme | Upto 60 Lakhs (for India) Upto 75 lakhs (for abroad) |
1-2% of the loan amount |
Credila | Credila Education Loan Scheme | Upto 60 Lakhs (for India) Upto 75 lakhs (for abroad) |
1-2% of the loan amount |
Request a callback or fill out the common application form to approach your financial officer at WeMakeScholars, they will analyze your loan profile and connect you to the best lender that will fulfill all your education loan requirements.
Education Loan Interest Rate in Kerala
For Studies In India and Abroad
Bank name | Interest rate | Interest rate concession |
SBI | Starts from 8.35% | 0.50% - for female students 0.50% - Rinn Raksha |
BOB | Starts from 10.60% | Discount upto 2% |
Karur Vysya Bank | Starts from 10% | upto 2% |
Union Bank | Starts from 11.15% | 0.5% for female students 1% if the SI is paid in full |
Axis Bank | Starts from 11% | upto 2% |
ICICI Bank | Starts from 10.5% | upto 2% |
IDFC First Bank | Starts from 8.5% | upto 2% |
Avanse | Starts from 11% | upto 2% |
Incred | Starts from 11% | upto 2% |
Auxilo | Starts from 11% | upto 2% |
Credila | Starts from 11% | upto 2% |
(NOTE- To check the latest and detailed interest rate click here)
Kerala Gramin Bank Education Loan Scheme
Kerala Gramin Bank offers an Education Loan Scheme to offer financial aid to students who wish to further pursue their education after finishing their bachelors. The student should be an Indian National.
The loan limit ranges from 10 to 20 Lakhs and the interest rate ranges from 10.50% to 13.60% with a loan margin that ranges from 5% to 10% depending on the country that the student wishes to go to.
The Eligibility Criteria include that, a parent or guardian should act as the representative for minor students, The loan will be in both the student's and the parent/guardian's names and the student must have gained admission to reputable institutions in India or overseas for higher education through a selection process based on merit.
Other Education Loan Features Offered By Banks Or NBFCs In Kerala
Expenses Covered
In India, loans for education are commonly used to finance expenses like Tuition fees, Examination fees, Study tours, Project works, and other costs related to college/ university such as room and board, materials, and other necessities. The Education Loan also includes living costs like housing and meals.
Moratorium Period
The term "moratorium period" refers to a time frame during which the student does not have to start paying back the loan. The banks give students 6 months to 1 year after they finish their course, to start repaying the loan. i.e., you get 6 months to 1 year to secure a job before you start repayment.
Loan Margin
The loan margin is the percentage of the total loan amount that the borrower has to pay from their funds. For instance, if the margin is 5%, then the borrower will have to pay 5% of the total loan and the lender will take care of the remaining 95%. Lenders often use this to minimize their risk if the borrower can't repay the loan.
Collateral Margin
The collateral margin is the percentage of the total loan amount that is backed by an asset pledged as collateral. Collateral is an asset that the borrower puts as a guarantee for the loan, if the borrower fails to make the loan repayments, the lender can take possession of the collateral to recoup their losses. Collateral Margin is often used by lenders to minimize their risk, in case the borrower is unable to pay back the loan.
Documents Required For Availing An Education Loan in Kerala
Documents required for Unsecured Education Loan in Kerala
To begin your education loan application, you'll have to give your bank some documents. We wrote an article about this recently. It tells you exactly what documents you'll need to avail an education loan. Here's a quick summary of the basic documents you'll need for a Bank of Maharashtra education loan:
- Online Application form
- Verification of identity (such as Aadhaar Card, Voter ID, Passport, Driving License, etc.)
- Confirmation of address (like Aadhaar Card, Voter ID, Passport, Driving License, etc.)
- Confirmation of enrollment (official admission letter from the educational institution)
- Educational records (academic reports for 10th grade, 12th grade, and graduation)
- Evidence of income for the last three months (pay slips or a company letter verifying salary)
- Form 16 for the past two years issued by your employer
- Income Tax Return (ITR) filed for the previous 2 years
- Financial documents like balance sheet and profit/loss account for the preceding three years (if the co-applicant is self-employed)
- Statement addressing any gaps in academic or employment history on stamp paper costing Rs. 100
Documents Required for Secured Education Loan in Kerala
For a secured education loan, in addition to the standard required documents, a co-applicant may need to submit a basic income certificate if they do not have any income tax returns along with proof of collateral being pledged is also needed, which would require additional documentation.
Additional Documents for Secured Loans for Kerala
- The title deed of the property being pledged as collateral
- The registered sale agreement, gift deed, or will
- Original receipt for the agreement listed above
- Munnadaram, a prior deed document, is essential and is needed even if a certified copy is available. If deviation is allowed, a conversion certificate must be obtained if the land has been converted from a wetland or Neelam land to non-agricultural land.
- If the property has private road access, acceptance from the neighboring property owners is required.
- 30 years of documents showing the transfer of ownership of the property or an earlier chain of sale deeds establishing ownership, including an extract of the controlled document (EC)
- The latest property tax bill and latest electricity bill have the same address as the property
- Copy of a municipality-approved building plan or plot layout for the property.
Common Reasons For Education Loan Rejection in Kerala
It is important for students from Kerala to understand that many private lenders and non-banking financial companies that offer loans without collateral are not currently accepting applications from students in the state. One potential solution to this issue is to arrange for collateral, such as through friends or relatives. However, if this is not possible, it may be worth reaching out to other organizations for potential assistance in obtaining an unsecured loan.
Additionally, it is important to note that applications with collateral properties that do not have access to a municipal road or have a very small road will likely not be accepted. To qualify, the property must have at least 8 feet of road access through a municipal road, or a NOC from neighbors if the road is private.
Lastly, it is important to note that Neelam land cannot be accepted as collateral for a loan.
Repayment Plan For Education Loans In Kerala
After you complete the course and the moratorium period ends, you will have to begin making monthly payments on the education loan that does not require collateral. The repayment period for this loan is 10 years.
For example, if a student takes out a loan of INR 35 lakh at an interest rate of 11.25% for 10 years, they will have to adhere to a repayment schedule where they make monthly payments to pay off the loan.
Repayment Schedule | EMI | Interest portion | Loan Outstanding | Principle Portion |
End of 1st year | 58684 | 37462 | 21222 | 3974695 |
End of 2nd year | 58684 | 34947 | 23737 | 3703962 |
End of 3rd year | 58684 | 32135 | 26549 | 3401152 |
End of 4th year | 58684 | 28989 | 29695 | 3062462 |
End of 5th year | 58684 | 25471 | 33214 | 2683643 |
End of 6th year | 58684 | 21535 | 37149 | 2259938 |
End of 7th year | 58684 | 17134 | 41550 | 1786031 |
End of 8th year | 58684 | 12210 | 46474 | 1255972 |
End of 9th year | 58684 | 6704 | 51980 | 663109 |
End of 10th year | 58684 | 545 | 58139 | 0 |
Education Loan Subsidy Schemes Applicable To Students From Kerala
The Government of India has introduced several interest subsidy schemes for students who wish to pursue higher education in India or abroad. These schemes provide financial assistance or interest subsidies to qualifying students. Some of the popular schemes include:
- Central Govt. Interest Subsidy Scheme (CSIS)
- Padho Pardesh Scheme
- Dr. Ambedkar Scheme for OBC and EBC
(To know more about these subsidy schemes click here)
Central Government Interest Subsidy Scheme (CSIS)
Objective: This scheme aims to offer an interest subsidy while the education loan is under a moratorium period.
Eligibility: It is available for students from economically weaker sections (EWS) with a yearly gross parental or family income up to Rs. 4.50 lakhs.
Interest Rate: The scheme provides a 100% interest subsidy during the specified period.
Padho Pardesh Scheme
Objective: The goal of this scheme is to provide interest subsidy during the moratorium period of an education loan.
Eligibility: It is accessible for students belonging to minority communities such as Muslims, Christians, Sikhs, Buddhists, Jains, and Zoroastrians, with an annual gross parental or family income up to Rs. 6.00 lakhs.
Interest Rate: Under this scheme, a 100% interest subsidy is offered.
NOTE: The Padho Pardesh Scheme has been inactive since April 1, 2022. However, beneficiaries who were already enrolled continue to receive the scheme's benefits.
Dr. Ambedkar Scheme for OBC and EBC
Objective: This scheme's purpose is to provide interest subsidy during the moratorium period of an education loan.
Eligibility: The scheme is meant for students belonging to Other Backward Classes (OBCs) and Economically Backward Classes (EBCs) with an annual gross parental or family income up to Rs. 8 lakhs.
Interest Rate: It offers a 100% interest subsidy during the specified moratorium period.
Along with these schemes, there are various other Schemes launched by the Kerala gov. through which you can take the benefits of an education loan.
Institutions For Higher Education In Kerala
Thiruvananthapuram, Kochi, and Alappuzha are home to several reputable educational institutions that offer a diverse range of courses including engineering, medical, and degree programs. These institutes are well-respected and considered among the leading universities in Kerala.
- Kannur University, Kannur.
- Kerala Kalamandalam, Thrissur.
- Kerala University, Thiruvananthapuram.
- KUHS, Thrissur.
- SSUS, Ernakulam.
- Malayalam University, Malappuram.
- Chinmaya Vishwavidyapeeth, Kochi.
- Chinmaya Vishwa Vidyapeeth, Ernakulam.
Why Choose WeMakeScholars For An Education Loan In Kerala?
A significant area of Kerala is covered by wetlands which cannot be pledged as collateral. Also, most of the area of Kerala is non-serviceable. In such situations getting an education loan is tough.
However, you can get assistance from WeMakeScholars. We are supported by govt of India under the Digital India Campaign and are partnered with 14+ banks (Public/Pvt). Go through the below points to understand more about the benefits you will have when you go through us.
Guidance from Experienced Professionals: If you are seeking a secured education loan, WeMakeScholars will assign a Financial Officer to guide you through the entire process and ensure a smooth and efficient experience, we even provide loan repayment support.
Rate of Interest Negotiation: Interest rates for unsecured loans are typically higher than secured loans, however, WeMakeScholars can assist you in negotiating a lower rate of interest, potentially as much as 2% below what the lender initially quotes.
Experience in Complex Cases: WeMakeScholars handles many complex cases involving multiple parties and prioritizes them to ensure a timely loan approval. We have a track record of successfully navigating these complex cases and getting them approved as soon as possible.
No Service Charge: WeMakeScholars offers all of its services free of charge and will continue to provide support to students until the loan is fully repaid.
Transparency: WeMakeScholars will keep you informed about the progress of your application and ensure that you have a complete understanding of the process
Cashback Provided: WeMakeScholars provides a cashback incentive for students who use our platform to apply for a study abroad loan. The cashback will be credited to the first loan disbursement of the loan and the maximum reward is INR 3000.
FAQs:
-
Which bank is best for education loans in Kerala?
-
How to get education loan in Kerala?
-
Which bank is easy to get an education loan in Kerala?
-
How much education loan can I get in Kerala?
-
Can I get an interest free education loan?
NEWS
The Kerala High Court has ruled that banks need to take a humanitarian approach when evaluating education loan applications
This decision was prompted by the rejection of a student's loan request by the State Bank of India (SBI) due to their low credit score. The SBI justified its decision based on a CIBIL score of 560, which was a result of an overdue loan and a written-off loan.
However, the court disagreed with the bank, asserting that denying education loans solely on the basis of credit scores was unjust. The student's legal representative argued that the loan was crucial for the student's financial stability, especially since the student had a job offer from a multinational company in Oman, ensuring his ability to repay the loan.
Taking these factors into account, the court directed SBI to immediately disburse the education loan of Rs4.07 lakh to the student's college. This ruling highlights the court's stance that banks should not overlook the practical realities when evaluating loan applications.
Last updated - 06/06/2023
WeMakeScholars- supported by IT Ministry, Govt. of India.
Our Education Loan team will help you with any questions
Kindly login to comment and ask your questions about Education Loan in Kerala